Odisha says it cannot supply bauxite to VAL immediately

Bhubaneswar: Odisha is not in a position to immediately supply bauxite to Vedanta Aluminium Limited (VAL), the state government said today while the company had sought permission to shut down its refinery at Lanjigarh due to scarcity of raw material.

“The state government is not ready at the moment to supply bauxite to Vedanta’s refinery at Lanjigarh. VAL’s case in the matter of bauxite mining is pending in the Supreme Court … They (VAL) are trying to arrange raw material for the plant,” Chief Secretary B K Patnaik told reporters after attending the High Level Clearance Authority (HLCA) meeting.

Though the state has a vast reserve of the mineral, it is not able to explore it due to different reasons including forest clearance and mining plan, he said.

The state government’s stand was made known after VAL formally informed the administration to allow it to shut down the refinery from December 5.

When contacted VAL Chief Operating Officer Mukesh Kumar said “We have already informed about our problem to the state government. Now our 1 mtpa refinery plant is running with only 50 per cent of its capacity due to bauxite scarcity.”

Kumar said despite the state government’s commitment to supply raw material to the refinery, it not given ‘even one gram’ of bauxite so far.

Under the situation, the company had already incurred Rs 2500 crore loss to run the Lanjigarh refinery and was not in a position to procure bauxite from other sources.

“We have run the plant for five years by bringing in bauxite from states like Andhra Pradesh, Jharkhand, Chhattishgarh and Gujarat … We get some bauxite from our BALCO mines. And that source is not sufficient,” he said.

The VAL COO in his letter requested the state government to help it by providing the raw material for running the refinery plant after December 5.

“If the situation improves by December 5, the company may not shut down the plant.”

VAL has so far invested Rs 9,000 crore in the project which employes about 7,000 people, including direct jobs to 3,000 persons, Kumar said.

Though the company had applied for 26 bauxite reserves in the state, nothing was finalised yet due to different reasons, company sources said.

The company required 10,000 ton of bauxite everyday to feed its 1mtpa refinery plant.